Nifty ends above crucial 5,800 level on gas price hike

CNX Nifty extended gains for the second straight day and ended over 2.8% higher on Friday amid firm global cues and strong buying witnessed in energy stocks following government's approval for gas price hike. Further, short covering in risk-sensitive stocks and strengthening rupee also provided the support to the market. On global front, Asian counterparts ended higher with Japanese Nikkei rallying over three and a half percent. Meanwhile, European markets made a positive opening in the early deals on Friday.

Back home, Indian equity benchmarks made a gap up start with inching toward its crucial 5,750 level buoyed by firm global cues on optimism that the Federal Reserve would not rush to rein in its stimulus measures which had fuelled a rally in global stocks. In the first half, markets traded in the positive territory as investors’ sentiments got a boost after the government approved doubling of natural gas prices from the present $4.2 per million British thermal unit (mbtu) to $8.4 per mbtu from April 1, 2014, a move which will directly benefit the domestic gas producers. Some support also came from the recovery in Indian Rupee as it came substantially below the Rs 60 level against the dollar. Markets extended its early gains and continued positive trade till the end of session on account of buying in all major indices of the market. Finally, nifty ended the session near its intra-day high level with a massive gain of 159 points.     

Meanwhile, the sectoral indices on the NSE made a positive closing. CNX Metal up by 4.30%, CNX Infra up by 3.99%, CNX Energy up by 3.76%, CNX Realty up by 3.58% and CNX Auto up by 3.06% remained the top gainers in the trade. India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, down by 4.77% and reached 17.95.

The India VIX witnessed contraction of 4.77% at 17.95 as compared to its previous close of at 18.85 on Thursday. The 50-share CNX Nifty gained 159.85 points or 2.81% to settle at 5,842.20.

Nifty July 2013 futures closed at 5841.45 on Friday at a discount of 0.75 points over spot closing of 5842.20, while Nifty August 2013 futures ended at 5861.15 at a premium of 18.95 points over spot closing. Nifty July futures saw an addition of 2.41 million (mn) units taking the total outstanding open interest (OI) to 14.33 mn units. The near month July 2013 derivatives contract will expire on July 25, 2013.

From the most active contracts, Tata Steel July 2013 futures were trading at a discount of 5.95 points at 267.95 compared with spot closing of 273.90. The number of contracts traded was 11,532.

Yes Bank July 2013 futures were trading at a premium of 0.65 points at 462.95 compared with spot closing of 462.30. The number of contracts traded was 14,883.

United Spirits July 2013 futures were at a discount of 1.35 points at 2178.65 compared with spot closing of 2180.00. The number of contracts traded was 66,227. 

Reliance Industries July 2013 futures were at a premium of 4.30 points at 864.75 compared with spot closing of 860.45. The number of contracts traded was 37,059. 

ONGC July 2013 futures were trading at a premium of 1.05 points at 332.15 compared with spot closing of 331.10. The number of contracts traded was 25,987.Among Nifty calls, 6,000 SP from the July month expiry was the most active call with an addition of 1.00 million open interest.

Among Nifty puts, 5,600 SP from the July month expiry was the most active put with an addition of 0.05 million open interest.

The maximum OI outstanding for Calls was at 6,000 SP (4.25 mn) and that for Puts was at 5,600 SP (6.00 mn).

The respective Support and Resistance levels are: Resistance 5880.27 -- Pivot Point 5814.88 -- Support 5776.82.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.37 for July -month contract. The top five scrips with highest PCR on OI were CESC 3.00, Sesa Goa 2.93, Raymond 5.50, Exide Ind 2.67, Grasim 2.50 and Syndicate Bank 2.21.

Among most active underlying, IFCI witnessed an addition of 1.04 million of Open Interest in the July month futures contract followed by Jaiprakash Associates which witnessed an addition of 0.46 million of Open Interest in the near month contract. Meanwhile, Unitech witnessed contraction of 0.81 million in the July month futures. Also, RCom witnessed an addition of 0.83 million in Open Interest in the July month contract. Finally, R Power witnessed contraction of 0.47 million of Open Interest in the near month futures contract.